The Senate Judiciary Committee grilled Live Nation Entertainment, Ticketmaster’s parent company, in a hearing that examined the impact of consolidation in the live entertainment and ticketing industries on Tuesday.
Live Nation spent over $1.1 million in 2022, according to new federal lobbying disclosures analyzed by OpenSecrets. Live Nation lobbyists reported efforts to engage lawmakers on issues related to oversight of the ticketing industry, ticket sale transparency and accountability and antitrust enforcement throughout 2022.
Uproar after reports that service failures and significant delays on Ticketmaster’s website prevented fans from purchasing Taylor Swift concert tickets in November prompted the hearing. A flood of fans — and bots — crashed Ticketmaster’s website in a Nov. 15 pre-sale for the pop star’s upcoming Eras Tour, leading the company to cancel public sales. Senate Antitrust Subcommittee Chair Amy Klobuchar (D-Minn.) and Ranking Member Mike Lee (R-Utah) noted the fiasco in a press release announcing the hearing.
“To have a strong capitalist system, you have to have competition. You can’t have too much consolidation — something that, unfortunately for this country, as an ode to Taylor Swift, I will say we know ‘All Too Well’,” Klobuchar said in her opening statement.
“In hindsight there are several things we could have done better, and let me be clear that Ticketmster accepts its responsibility as being the first line of defense against bots in our industry,” Live Nation Entertainment President and Chief Financial Officer Joe Berchtold acknowledged in his testimony.
But Ticketmaster’s troubles predate the botched pre-sale and have since continued. Malfunctioning scanners at a sold-out Bad Bunny concert in Mexico City rejected thousands of valid tickets purchased directly from Ticketmaster a few weeks later, leading Mexican President Andrés Manuel López Obrador to condemn Ticketmaster and demand refunds for ticket holders turned away.
Federal lobbying spending by Ticketmaster’s parent company exploded in 2020. That fall, Live Nation lobbyists pressed lawmakers to make the company and its subsidiaries eligible for the coronavirus emergency relief program, The Washington Post reported. But federal lobbying spending by the ticketing giant has remained high as antitrust concerns loom.
Of the 32 lobbyists that reported activity on behalf of Live Nation through the fourth quarter of 2022, 24 swung through the revolving door. One of those so-called “revolvers” is Jonathan Becker, former chief of staff and chief counsel to Klobuchar who now works as a partner at the lobbying firm Mayer Brown.
Becker reported lobbying on behalf of Live Nation to “[e]ducate on ticketing market and monitor efforts at reform” during the fourth quarter of 2022 as members of Congress lambasted Live Nation as a monopoly.
Days before the hearing, two additional firms registered to lobby on behalf of Live Nation. Stewart Strategies and Solutions registered on Jan. 13 and reported lobbying on “[t]ransparency and accountability to tickets sales pricing” during the fourth quarter of 2022. Seth Bloom, former the general counsel for the Senate Judiciary Subcommittee on Competition Policy, Antitrust and Consumer Rights, registered on Jan. 19 with his firm Bloom Strategic Counsel.
Bloom reported lobbying on “competition issues in the ticketing sector” during the final quarter of 2022. Live Nation is the latest company to enlist Bloom to fend off antitrust pressure, a cohort that includes Apple, Amazon, DoorDash and JetBlue. Following a massive 11th-hour lobbying blitz, tech giants including Amazon, Apple, Meta, and Google parent company Alphabet Inc. blocked two bipartisan bills that aimed to increase competition in the industry, OpenSecrets previously reported.
Live Nation faces an ongoing investigation by the Department of Justice, which approved the 2010 sale of Ticketmaster to Live Nation, into allegations that the merged company engages in practices that are unfair to consumers.
Tarnished “Reputation”
In his opening statement, Berchtold told the committee that the ticketing and live entertainment industry is more competitive today than it was before Live Nation’s 2010 merger with Ticketmaster. He acknowledged “problems” in the industry, but says bots led to a “terrible consumer experience,” calling efforts to combat bots an “escalating arms race” that requires legislative action.
He also issued an apology — “We apologize to the fans, we apologize to Ms. Swift; we need to do better and we will do better.”
But other witnesses — some competitors — detailed the impact of consolidation in the industry.
Jerry Mickelson, CEO and President of Jam Productions LLC, alleged Ticketmaster squashed competition by purchasing venues and threatening financial penalties on a tour deal if artists wanted to work for Jam Productions.
“Their biggest fear is if they leave Ticketmaster, they will lose content,” Mickelson said of venues.
Jack Groetzinger, CEO of SeatGeek, told the committee in his opening statement that venues feared losing Live Nation concerts if they don’t also use Ticketmaster for ticketing.
Groetzinger later alleged management at Barclays Center told SeatGeek it was going back to Ticketmaster for concert ticketing after seeing less shows come to the Brooklyn-based venue. Barclays had replaced Ticketmaster with SeatGeek in 2021.
Berchtold said he had not heard anything to indicate that Live Nation changed bookings based on the 2021 change. He previously told the New York Times that “there was no retaliation at Barclays for not using Ticketmaster, in terms of the routing of any concerts.”
Clyde Lawrence, singer-songwriter of the New York-based band Lawrence, provided an artist’s perspective. Expanding upon arguments laid out in his New York Times op-ed entitled “Taylor Swift’s Live Nation Debacle Is Just the Beginning,” he told the committee that Live Nation as the promoter, venue and ticketing company resulted in lopsided “incentives” for the entertainment giant in negotiating with artists.
While artists can set their base price of tickets, Lawrence said the band found out the fees added like everyone else — by logging onto Ticketmaster. Lawrence claims fees on his band’s tickets have seen fees as high as 82% added.
But Lawrence emphasized his experience has not been all bad, praising the Live Nation venue employees he worked with to put on the best shows possible.
“We truly do not see Live Nation as the enemy, they are just the largest player in a game that feels stacked against us as artists and often our fans as well,” Lawrence said. The artist later told Sen. Sheldon Whitehouse (D-R.I.), “there has literally not been a single time in our career when we have played at a Live Nation venue where we had any opportunity to not have Live Nation be the promoter or not have Ticketmaster be the ticketing company.”
“These things will change”
Kathleen Bradish, vice president for legal advocacy at the American Antitrust Institute, proposed some solutions to the industry consolidation detailed in the hearing. Her proposals included empowering agencies to challenge vertical mergers, strengthening and clarifying existing antitrust law and curbing self-preferencing by digital ticketing platforms.
Bradish also voiced support for the Competition and Antitrust Law Enforcement Reform Act of 2021 that would, among other things, update legal standards for mergers and strengthen standards for prohibiting exclusionary conduct.
During the hearing, Sen. John Kennedy (R-La.) proposed making tickets non-transferable, or at least only transferable at-price, to protect consumers from high prices.
But Bradish said non-transferability will not get to the heart of the competition issue at question. Nuzzo also pointed to a 2018 Government Accountability Office report that found tickets on the secondary market are often going at below market value. He added that the secondary market allows artists like Lawrence selling to smaller venues — relative to Taylor Swift — the opportunity to fill those venues.
Lee called restrictions on transferring tickets a “nightmare dressed like a daydream,” one of several references to lyrics from a Taylor Swift song.
Sen. Mazie Hirono (D-Hawaii) asked Lawrence what his band would like to see change. Lawrence expressed support for an expansion of off-platform ticket sales, caps on fees and greater transparency on settlement sheets bands receive at the end of each show.
“We have very little say or transparency or choice in a lot of aspects of how the financials of our deals are put together, and no choice or say or visibility in what our fans experience when buying our tickets,” Lawrence later told Sen. Ted Cruz (R-Texas).
In a written statement to OpenSecrets, Live Nation said the best way to protect consumers would be to enact anti-bot legislation and new penalties for violations, ban speculative selling and deceptive websites scamming customers and mandate all-in pricing so customers can see the full cost of their ticket up front rather than at checkout.
source
Source: OpenSecrets.org
